Bankers game for ULCRA repeal

TNN|

Oct 27, 2006, 03.24 AM IST

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MUMBAI: Housing finance providers feel that repeal of the Urban Land Ceiling and Regulation Act (ULCRA) would improve housing supply in Mumbai, a city where land is expensive and over half the population live in slums. An increase in supply could check the runaway rise in housing prices in the city.

According to Deepak Parekh, chairman, Housing Development Finance Corporation, the ULCRA has failed to achieve its objective of bringing about a more equal distribution of land. On the contrary, the Act resulted in acres of land in the city lying locked up and being used as sheds and warehouses as no deals could take place for large parcels of land.

"The repeal should hopefully release more land for housing in Mumbai. It should have happened long ago, but still this is the best news that I have heard," said Mr Parekh.

Although the Central government has done away with its land ceiling act and several state government's have repealed theirs, Maharashtra has held on. According to Chanda Kochhar, deputy managing director, ICICI Bank, repealing of the act would be a positive development if it releases more land for housing.

A section of social activists has, however, been opposing the repeal of the act on the grounds that it has not achieved its objective because of the government's reluctance to implement it. They demand that the government acquire large tracts of lands held by large corporates and landowners and utilise it for providing housing.